Despite Global Pandemic, Our Real Estate Market Was the Hottest Ever for August

Much to the consternation of observers, the real estate market in metro Denver was hotter this August than it was in any previous August, according to the Market Trends Committee of the Denver Metro Association of Realtors (DMAR). At this rate, 2020’s statistics at year end will likely exceed 2019’s statistics.

The report covers an expanded metro area, including 11 counties instead of the 7 urban and suburban counties that you and I think of as “metro Denver.” The non-urban counties included in the report are Clear Creek, Gilpin, Elbert and Park.

Detached single-family homes sold like crazy in August—up over 6% from August 2019, despite 50% fewer active listings at month’s end. The average sold price was up 13.8% from last year, and average days on market was down 23%.

Attached homes sold on a par with last year, although their inventory was also down — 19% fewer listings at month’s end. They did sell quicker, though, with days on market down by over 27%.

Unlike DMAR, I like to define the metro Denver market as within a 25-mile radius of the state capitol, as shown here, instead of by county. Using that method, the number of detached homes sold this August was up 13.7% from August 2019, and the sold price per finished square foot (my preferred metric) was up 7.0%. Average days on market dropped by 31%, but median days on market plunged 57% from 14 days in August 2019 to 6 days this year.

Even more interesting to me is that median days on market was in double digits until March 2020 — the first month of Covid-19 lockdown — when it dropped by 40% to 6 days, and remained in the 5- to 7-day range through August. It could be said that “Stay at Home” and “Safer at Home” really meant “Buy a Home” in the real estate business!

Average sold price within that  25-mile radius rose by 13.4% to $597,290, while median sold price rose by 11.6% to $505,000. The gap between average and median is attributable to a large number of million and multi-million dollar closings. I wish others would stop focusing on average stats for that reason.

The number of active listings (what we call “inventory”) plummeted from 6,483 in August 2019 to 3,444 in August 2020, a 47% decline.

Another measure of market strength is how many listings expire without selling. That number was 777 in August 2019, but it fell by 37% to 493 this year.

The average ratio of sold price to listing price was 100% both last August and this August — suggesting that roughly half the listings sold above full price. With half the homes selling in 6 days or less, it’s to be expected that there were multiple offers and possibly a bidding war on many listings.

This week my downtown Golden fixer-upper closed at $665,000, which was $40,000 over listing price. My Lakewood listing from last week is already under contract at $55,000 over full price. Clearly, the seller’s market is still hot despite the pandemic.

If you have considered selling your home, there couldn’t be a better time than now to put your home on the market. And you couldn’t do better than call one of us listed below to talk about it. Your home would, of course, be featured in my weekly Denver Post column and on this blog.

If you let us represent you in the purchase of your replacement home, the listing commission could be as low as 3.6% and qualify you for totally free moving!

Jim Smith— 303-525-1851

Jim Swanson — 303-929-2727

Carrie Lovingier — 303-907-1278

Chuck Brown — 303-885-7855

David Dlugasch — 303-908-4835

Carol Milan — 720-982-4941

Just Listed: Mid-Century Modern Ranch in East Denver

1930 Roslyn Street, Denver – Just Listed at $475,000

This 3-BR, 2-bath home is about 2 blocks south of the Stapleton (now Central Park) neighborhood. No basement, large, well cared for front and back yards with in-ground sprinkler system. Hardwood floors in the living room and bedrooms. Bedroom #3 is non-conforming (no window). Updated kitchen with stainless steel appliances, plenty of cabinet space with a coffee bar. Family room features a wood burning fireplace, carpet and a brand new 8-foot sliding glass door that leads to a covered patio in the private back yard. The 24×24 oversized garage is accessed from the alley and features a 9-ft high garage door. Another feature of this home is its proximity to several parks, Stapleton Town Center and Stanley Marketplace. This house is perfect for entertaining. Take a narrated video tour of this home at EastDenverHome.info. Open house Sat., Sept. 19, 11 a.m. to 2 p.m., or call Chuck Brown, 303-885-7855.

Just Listed: 3-Bedroom, 3-Bath Golden Townhome

This townhome at 416 Gladiola Street is nestled in area known at Sixth Avenue West, east of Indiana Street, behind a couple extended stay hotels and a medical center. It was just listed at $350,000. It has some nice updates in it, including an open floor plan and mostly finished basement. Take a narrated video tour of it online at www.GladiolaTownhome.com.

Mountain view from living room and from master bedroom above it.

You Decide: Boutique Hotel, B&B, or Luxury Home!

This hotel has all the luxury and amenities of a fine hotel, and then some. No expense was spared building this newer European-style boutique hotel located on a mountain river. It pampers guests by offering a distinctly different hotel experience, from flatscreen TVs to steam showers, espresso machines, hot tubs and fireplaces. The owner, a friend of Rita and me, has approximately $2.5M in build-out costs alone! High-quality landscaping, construction, and beautifully appointed design throughout the property make this home a must-see! The property also includes separate apartments for manager and owner. 

A vacationer’s dream, where guests are treated like royalty as the Five-Star reviews on all major websites proclaim! It is located just minutes from world-class skiing, and offers panoramic views for its guests. Virtually endless possibilities for adventure abound — anything from skiing, enjoying all types of restaurants/brewery, and shopping in the winter to fishing, hiking, cycling, etc. in the warmer months. You name it, it’s close by! There are myriad growth opportunities for an investor to turn this property into whichever profit center one would desire. Anything from a high-end boutique hotel as it is currently, to a B&B, long-term rental, or an amazing extended family mountain home! (Would require change of zoning.) There is growing development in the area, and the business has several, large, extended-stay clients, which can easily be expanded upon. The revenue from these extended-stay clients, even at a discount, makes this newer 10-room hotel property a solid investment.  For more information or to see it, call Jim Smith, 303-525-1851, or Wayne Wright, 720-436-1472.

Just Listed: 1901 Farmhouse on Large Fairmount Lot

4820 McIntyre Street, Golden – Just listed at $875,000

This home sits on a 0.78-acre lot with three outbuildings, one of which is a 20’x50’ heated building with electricity, water and an indoor garage space. For a 1901 structure, this home is beautifully updated and comfortable, but, with its large lot, the seller realizes the highest and best use of the parcel may be redevelopment, such as has already happened both north and south of it. Meanwhile, it’s a lovely home with a gated driveway and is fully fenced, providing lots of space, covered and uncovered, for all your toys! You could even add more out-buildings! Inside the home, the plumbing was updated to PEX throughout, and the electrical was updated in 2011. The metal roof is about 15 years old and survived multiple hail storms with no damage. There are porches on three sides, although not connected. The east-facing porch includes an outside kitchen with its own refrigerator, propane grill with griddle and unplumbed sink set in a granite countertop. This has been a lovely family home for decades! Check out the numerous still photos and narrated video tour at www.FairmountHome.info, then call Jim Smith at 303-525-1851 for a showing.

Brick Ranch in Golden’s East Street Historic District

1910 East Street – Just listed at $759,000 – Open Saturday, Sept. 12th, noon to 2pm

This exceptionally remodeled brick ranch with walk-out basement is in a highly desirable location — within walking distance of downtown Golden, the Colorado School of Mines, Natural Grocers & Safeway, and a trailhead to the iconic Castle Rock formation above the Coors brewery. Entering the front door, you’ll be pleasantly surprised by the open floor plan with modern kitchen, hardwood floors and a unique stair railing made from a ski-lift cable. The chef’s kitchen features a Wolf professional gas range, stainless steel appliances, and quartz countertops. The large deck next to the kitchen extends the living space, offering a wonderful place to enjoy the views of Lookout Mountain and Mt. Zion while having your morning coffee or evening cocktails. Downstairs, the walkout basement’s windows flood the office and bedroom with sunlight. A large multipurpose room would be the perfect spot for a pool table or home theatre. Sustainable features include solar PV panels, new Andersen windows, new exterior doors, attic insulation, a state-of-the-art high efficiency hydronic heating system, and a low maintenance xeriscaped front yard and a synthetic backyard lawn that looks and feels real. Other major improvements include new roof (2017) and sewer line (2007). The large backyard has room to build a dream garage (accessed from the alley) or perhaps a carriage house. This property has too many great features to list here, so check out the magazine quality still photos and narrated video tour at www.GreatGoldenHome.info to learn more, then call your agent or listing agent Chuck Brown at 303-885-7855 to see it.

If You Don’t Put Your Home on the MLS, You May Not Get What Your Home Is Worth

A reader wrote me last week complaining that some homes in her subdivision are being sold privately for less than they should, without putting them on the MLS. It bothered her because doing so creates lower comps that could affect what she is able to get for her own home when she sells.

Just as important, there are buyers who would like to move into her neighborhood who are frustrated when a home is sold before they can submit their own offer for it. And, of course, sellers are not getting the highest possible price for their home, as I’ll explain below.

Among the culprits are fix-and-flippers and “iBuyers” such as Open Door and Zillow Offers, who convince sellers to take a cash offer, claiming to save them the cost and inconvenience of listing their home on the MLS. More about them below, as well. (See my Jan. 2, 2019 and my Aug. 22, 2019 columns about iBuyers.)

If anyone offers to buy your home for cash without listing it, there’s one thing you can be certain of: they’re going to pay you a price that leaves lots of room for profit. That is money that could be yours if only you exposed your home to the full market by putting it on the MLS.

The worst thing you can do in a “sellers market,” which is what we have now, is to sell your home off the MLS. The next worse thing you can do is, after putting your home on the MLS, to sell it to a buyer who quickly offers you full price. If someone offers you full price on day one, you can be sure that there are other buyers who’d be happy to pay even more. Four days should do it.

But there is something worse than both those scenarios, and that is to put your home on the market at a price which does not attract any offers. I tell my sellers that they can overprice their home, but they can’t underprice it, because a low price can trigger a bidding war. An experienced Realtor like myself can help you set the perfect listing price. Just remember not to accept the first offer — unless that offer comes long after you put your home on the market, because you overpriced it.

What I see all too often is sellers putting their home on the market at a wished-for price, then lowering the price reluctantly over several weeks, and ending up getting only one offer, not multiple offers, at a price that’s lower than what they might have gotten if they had priced the home right initially.

It’s tempting, I know, to accept an unsolicited offer to sell a home without paying 6% commission, but I can’t even remember the last time I charged 6% commission. Remember, 2.8% of any listing commission goes to the buyer’s agent. Typically, sellers who try to sell “by owner” end up paying that 2.8%, so they only save the difference between 2.8% and the full listing commission, which is 5.6% on average. At least that is what I charge, and I reduce it if I sell the home myself, and I reduce it further when I earn a commission on the purchase of the seller’s replacement home.

If you factor in the totally free moving which I provide (locally, of course) when you sell and buy with me, it’s hard to justify not putting your home on the MLS with Golden Real Estate, thereby exposing it to all those bidders in this still-hot seller’s market.

Our Denver MLS, REcolorado, is now enforcing a new rule called “Clear Cooperation,” which was voted into being by the National Association of Realtors last November. It requires MLS members to put their listings on the MLS within 24 hours of promoting their listings in any way.

The rule is very simple: If a listing agent promotes his or her listing in any way — with a yard sign, tweet, Facebook post, or newspaper article, etc. — the listing must be on the MLS, either as “Coming Soon” or “Active.”  If it’s “Coming Soon,” the sign must say so, and it can’t be shown, even by the listing agent himself. Once shown, it must be changed immediately to Active status, making it available for showings by all members of the MLS. Prior to Sept. 1st, REcolorado only issued warnings, but fines are now being levied for violations.

So, yes, there can be off-MLS sales, but not involving an MLS member unless there was no marketing at all, not even emails to his/her clients. With “pocket listings” now banned, the focus now turns to the iBuyers, companies like Open Door, Zillow Offers and others which directly solicit homeowners to purchase their homes, charging a 7% “service fee,” with the intention of flipping the home for a profit.

Only time will tell whether this new rule, with fines being levied, will make a big difference, but it surely will make some difference.

Any Talk About Affordable Housing Must Include Mobile Homes

Mobile or “manufactured” homes are the original and enduring form of affordable housing. You see them in rural and, as workforce housing, near resort communities, but you also see them in the Denver metro area. Five mobile home parks are within two miles of our Golden real estate office.

More than 100,000 people live in over 900 mobile home parks across Colorado. If our goal as a society is to preserve and expand affordable housing, we must protect and even expand mobile home ownership.

But there are problems.

Mobile home owners pay upwards of $100,000 for their homes (mostly pre-owned), but they have to rent lot space in a park. I was told that zoning laws in Jefferson County (and probably elsewhere) don’t allow a mobile home not in a mobile home park.

Increasingly, mobile home parks are owned by big national corporations whose only interest is maximizing profit. Because it is financially prohibitive to move a mobile home, and you can only move it to another park, the park owner has the home owner over a barrel. They can increase the rent as much and as often as they want and the owner has to pay it or be evicted. Until the passage of HB19-1309 by the Colorado General Assembly last May, which strengthened the Mobile Home Park Act, a homeowner (who the courts treat as a tenant) had 48 hours to vacate for non-payment of rent, and if they left the home in place, it became the property of the park owners. Now they have 10 days to cure a notice of rent past due and then have 30 days to vacate, but the problem persists — you either pay or you surrender ownership of your home.

Now that mobile homes can be listed in the MLS, I found 11 such homes in the metro area that are active, pending or have closed in the past 6 months. Rents range from a low of $7,500 to a high of $10,920 per year. Many of the homes couldn’t be sold for that much and are depreciating every year, unlike “regular” homes, which appreciate.

A mobile home, by the way, is not real estate and can only be on the MLS if it is on owned land or has a land lease. Mobile homes are titled with the Department of Motor Vehicles, and yet they are taxed as “real property” by the county assessor rather than via “ownership tax” from the DMV, as with automobiles. The property tax on those 11 listings ranged from $142 to $803 per year.

Although last year’s legislation created a complaint resolution process for mobile home owners, it is not utilized as much as it could be, because residents are fearful of retaliation by management. If you get on the wrong side of management, you face increased enforcement and fines which are added to rent. Don’t pay the full rent, and you’ll be evicted. And you thought HOAs were difficult! One resident of a Golden mobile home park who has been outspoken told me that the number of “rule notifications” – known among residents as “nastygrams” – has exploded as a result of speaking up.

I was educated (in less than 20 minutes!) on this topic by a segment by John Oliver on his program “Last Week Tonight.” Do watch it using the link above.

While mobile home park residents may be reluctant to speak up for themselves, they have allies among progressives within the larger community, notably the Golden United Housing Task Force. They meet monthly on the first Wednesday of the month. One of the leaders of that effort within Golden United, Kathy Smith (no relation), sent me a super-informative email with the following information, much of which is reflected in my published column.

The state government’s website is https://cdola.colorado.gov/mobile-home-park-oversight.

Also, the Colorado Sun did a series titled “Parked.”  https://coloradosun.com/tag/parked-half-the-american-dream/

Golden United and the Jefferson Unitarian Church Community Action Network (JUC CAN) are collaborators on a 2-year grant made possible by the Community First Foundation to engage and inform residents of manufactured housing communities in Jefferson County about new statewide laws that provide protections for residents of mobile home parks. The main organizations for the grant are Together Colorado, 9to5 Colorado, and the Colorado Coalition of Manufactured Home Owners (CoCoMHO). We are just getting started and will be working at some mobile home parks in the Golden area, including Mountainside Estates, Golden Terrace, and Golden Hills. We will also be working at parks in Arvada and probably Lakewood. Here are some excerpts from the grant application:

Background:

An important aspect of housing options in Jeffco is preservation of existing affordable housing. Manufactured housing is the largest unsubsidized source of affordable housing and provides homes to seniors on fixed incomes, low-income families, people with disabilities, veterans, immigrants, and others in need of low-cost housing. More than 100,000 people live in more than 900 manufactured home parks (MHPs) across Colorado,  In MHPs. Home owners own their homes but rent their lot from the park owner. Because it is often nearly impossible to move their homes, when park owners raise lot rents, residents are trapped, choosing between paying the rent or abandoning their homes. Many MHPs are owned by corporate landlords.

The Colorado Department of Regulatory Agencies (DORA) performed a Sunrise Review of Manufactured Housing Communities (October 2018). The report states:

“Clearly, harm is occurring in manufactured housing communities… The harm largely stems from the lack of enforcement of existing laws, bad actors exploiting a relatively loose regulatory structure, and the inevitable tension that arises when the house belongs to one person but the land beneath it belongs to someone else. Conditions for Colorado owners of manufactured homes could be improved by increasing community engagement within the communities, including the forming of homeowners associations and cooperatives; educating homeowners about their rights and encouraging them to challenge community owners when appropriate or file complaints with the proper authority…”

This DORA report provided the justification for recent legislation that enforces the Mobile Home Park Act (MHPA) and created the Mobile Home Park Dispute Resolution and Enforcement Program (DREP). It also provides validation for our approach of community engagement and education.

As laid out in the DORA Review, residents of many MHPs are experiencing exploitation and numerous stressors. Recent impacts from coronavirus will further hamper the ability of families and individuals to meet basic needs. Some examples of current practices that create instability and stress include: (a) increasing rent, decreasing services, issuing mandatory fees, or billing for something not previously billed in an unequal way, (b) issuing warnings/citations/fines that are not justified, (c) serving notices or threatening eviction when not justified, (d) selectively enforcing rules/requirements, (e) conducting management visits or surveillance targeted at a complainant that is unjustified, (f) adding maintenance responsibilities for trees or fences, and (g) property rights capture (i.e., loss of autonomy over home and lot space).

These practices lead to instability and stress, both economic and emotional. Many of these practices can be addressed through enforcement of the MHPA and the rules for the DREP complaint process. Further policy changes can be sought through the state legislature and local jurisdictions. Ultimately, more oversight, protections, and enforcement can lead to systemic change which will, in turn, reduce expense burdens and the number of evictions, and improve the quality of life for Jeffco MHP residents.

Recently, the Colorado Legislature has updated laws that regulate MHPs. The Mobile Home Park Act (MHPA), circa 1985, provides protections under the law for mobile home residents, but has had minimal enforcement. In 2019 the legislature passed HB19-1309, MHPA Oversight. This law grants the Colorado Division of Housing oversight over the MHPA and the authority to administer a Dispute Resolution and Enforcement Program (DREP). The DREP provides a mechanism to submit complaints without the expense of hiring a lawyer and will begin taking complaints on May 1, 2020. An anticipated benefit of the DREP is to decrease evictions and housing insecurity in MHPs.

For more information or to join Golden United in their MHP initiative, you can contact Kathy Smith at 303-278-8025.

Coming Soon: A Solar-Powered Green Mountain Home

13615 W. Wesley Ave., Lakewood – Just listed for $530,000

    I just listed this 4-bedroom, 3-bath home in the Green Mountain Village section of Lakewood. Although still heated by gas, it has a solar PV system which meets the home’s entire electrical needs, keeping the monthly electric bill to under $10! (The solar system is owned, not leased.) The landscaping, both front and rear, is fabulous, with an expansive brick patio and Tuff Shed in the backyard. Although showings don’t begin until Sept. 14th, you can take a narrated video tour (currently in production) online at www.LakewoodHome.info. Or call me at 303-525-1851 with questions.

Coming Soon: Patio Home in Gated Lakewood Subdivision

9695 W. LaSalle Ave., Lakewood — Just listed for $525,000

   This beautifully updated patio home offers maintenance-free living. It’s on a cul-de-sac at the back of the Primrose Above Bear Creek gated subdivision just east of Kipling Street and north of Yale Avenue. This is not an age restricted (55+) subdivision, but most of these homes are occupied by seniors who appreciate main-floor living and not having to mow or water their lawns. This 2-story home has a main-floor master suite plus a second master suite upstairs, along with a huge loft overlooking the living room with its vaulted ceiling, gas fireplace and sliding glass door to the fenced backyard. A third bedroom and 3/4 bath are in the fully finished basement. The eat-in kitchen features Caesarstone countertops and sink, and newer stainless steel appliances. Take a video tour at www.LakewoodPatioHome.info. Then call your agent or Jim Smith at 303-525-1851.